Wolverhampton-based Marston’s food sales hit by heatwave as the price of a pint soars

Pubs and restaurants group Marston’s today revealed the cost of the heatwave.

In short, customers are happy to keep drinking beer but aren’t interested in roast beef, scampi or a mixed grill.

The West Midlands-based company today revealed food sales weakened in the last four weeks due to the recent spell of hot weather.

It also revealed bad news for drinkers, with the price of a pint rising by up eight per cent in recent weeks.

For the 42 weeks to July 23 total like-for-like sales were down on the same period in 2018-2019 and reflecting the impact of the reintroduction of trading restrictions in December and January.

Sales in the Wolverhampton-based group’s managed and franchise pubs returned to 2018-2019 levels in the period. Drinks sales have continued to outperform food sales.

Like-for-like sales in the last 16 weeks to July 23 are one per cent below 2018-2019, but in the first 12 weeks of this period sales were slightly ahead.

Over the last four weeks of the period, despite drinks sales continuing to be in growth, food sales weakened.

But, weather apart, Marston’s says it remains encouraged that people still enjoy popping into their local for a night out.

The firm, which has its headquarters in Wolverhampton city centre, said the level of customer demand had been encouraging, notwithstanding the uncertainty around the cost of living for consumers. It comes despite rising prices, with the price of a pint at its London pubs now around £8.

Looking forward, the group says it remains well placed to deliver positive trading with its balanced estate of predominantly community pubs, investment in outdoor trading areas and staycation custom.

But, like the rest of us, Marston’s says the cost of living is having an effect. The group’s electricity contract ended in March and the ongoing situation in Ukraine continues to impact energy prices with electricity costs expected to be around £2 million higher than previously expected for the secnd half of the financial year. With energy cost inflation likely to persist in the short term, Marston’s has taken the decision to fix the group’s electricity rates for winter 2022, covering the six-month period from September 2022 to March 2023 with an incremental cost impact of around £3m in 2022-2023. The group’s gas price is also fixed until the end of March 2025 with no additional incremental spend anticipated.

Chief executive Andrew Andrea said: “Since Covid restrictions were lifted, we have been encouraged with the level of sales as we have transitioned to operating on a ‘business as usual’ basis.

“In spite of external economic headwinds, we have not seen any discernible change to customer footfall to date and remain cautiously optimistic that we will continue to see similar levels of customer demand across the summer where we will benefit from our investments in outside space and staycations.

“We continue to focus on our strategic plans and remain on track with our debt reduction strategy.

“We are making considerable progress with the transition away from our value food Two for One brand which will be complete by the end of September.

“We have completed 45 of these pub conversions to date and, whilst still early days, initial indications are encouraging with positive customer feedback and improving returns. We remain confident that the changes we are implementing now will deliver a higher quality business for the group over the medium to longer term.”

Marston’s operates an estate of 1,481 pubs and employs around 12,000 people, including several hundreds at its main office just off Wolverhampton’s ring road. It is one of the main operator of pubs across the West Midlands, Shropshire and Staffordshire.

The challenges outlined by the company mirror those revealed by JD Wetherspoon earlier this month. It said it was expecting losses of around £30 million for the year to the end of July after hiking staff wages and ramping up spending on repairs and marketing amid a slow recovery in bar trade.

Wetherspoon – which has more than 800 pubs across the UK and Ireland – had previously said in May that it expected to break even over the full year, having cheered a return to profit in March. But it said the recovery for many pub firms had been “slower and more laborious” than expected, while the sector is also grappling with soaring costs and a pull-back in consumer spending due to rising inflation.

Sales of draught ales, lagers and ciders – previously the biggest driver of pub trade – were eight per cent below 2019 levels, it revealed.

“Many people predicted a boom in pub sales when lockdowns and restrictions ended due to pent-up demand, but recovery for many companies has been slower and more laborious than was anticipated,” the group said.

Wetherspoon said staff costs were far higher than before the pandemic, with firms across the sector having to increase wages to deal with the situation.

It added that it is now “with minor exceptions, fully staffed”.